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Recent college grad here
Old 09-08-2004, 01:44 PM   #1
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Recent college grad here

Hi all,
Graduated college earlier this year and started working for a large employer making a decent starting salary. It took me about 2 months to realize that unless I made an effort to collect appreciating assets, I would be stuck on the wage-slavery path for the rest of my life. Sure, it wouldn't be an uncomfortable existence, but I don't want to live my live depending on that paycheck every two weeks...I want the freedom to be able to take time off from work or make a radical career change before I reach 59 1/2. Someone tipped me off on this website and I think it's great!

I majored in finance so I understand the basic principles underlying personal finance...compoudning, the equity markets, bonds, other investment options, macro vs. microeconomic factors, etc. Now I'm trying to translate the classroom lessons into a strategic plan to avoid perpetual wage-slavery. I believe that the markets are mostly efficient so I go for diversification across a variety of asset classes.

Anyway, feel free to PM me if you're a twenty-something that's started thinking about ER. So far I have only found one other person in this age bracket who shares my viewpoint. Thinking about setting up a blog to chronicle the journey (similar to pfblog.com) if you have any interest in contributing...could be good to have some accountability partners. I've also started putting together basic income statements and balance sheets to detail my financial position over time, may try to post some of them here later. Cheers!
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Re: Recent college grad here
Old 09-08-2004, 03:36 PM   #2
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Re: Recent college grad here

Sweet jesus man, $100k by age 23? You'll beat me yet Seriously though, congrats on the great start.... oh, and welcome aboard from FW
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Re: Recent college grad here
Old 09-08-2004, 06:33 PM   #3
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Re: Recent college grad here

Been lurking for a while, but I figured that I might as well chime in. I'm only 24. Most of my friends think I'm insane, but I don't really have a problem with that. Never wanted to be "normal" anyway.

You are way ahead of me. I actually did a complete 180. When I graduated, 2 years ago, I thought I would never want to retire. I had this idealistic view that someday I would find a job that I actually looked forward to going to in the morning. Now that I have been slapped into reality. I want to get out as soon as possible. Read Your Money or Your Life and Cashing in on the American dream. There's no turning back now. Never had a job where I couldn't think of other things I'd rather do with my time.
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Re: Recent college grad here
Old 09-09-2004, 07:00 AM   #4
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Re: Recent college grad here

Welcome soupcxan.. and gia.

I'm a bit older, 28. *Almost out of the twenty-something category :-/... Good to see the youngins that recoginize the importance of the independence $$ can bring.

I, like gia, was/am incredibly idealistic, and have since come to the conclusion that my ideals will likely never fit. *I also have absolutely no trouble thinking about what else I could be doing with my time.

Keep an eye on those expenses. *Make sure your $$ are going towards the things that you deem truly important. *I believe that is key. *Depending on your salary, you might be surprised how fast you can accumulate.

Congrats on your substantial early nestegg, soupcxan. *Well done
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Re: Recent college grad here
Old 09-09-2004, 10:08 AM   #5
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Re: Recent college grad here

Quote:
When I graduated, 2 years ago, I thought I would never want to retire. *I had this idealistic view that someday I would find a job that I actually looked forward to going to in the morning. *Now that I have been slapped into reality. *I want to get out as soon as possible.
Interesting...when I was in school I also felt as though I would never retire...and to some extent, I still feel that way about the "traditional" view of retirement. I like working on solving business problems and creating new opportunities, but I don't always want to have to depend on my employer to provide these to me. I don't want to get trapped as a paper-pushing middle-manager with no where to go and no real creativity at work. For me, working towards ER is about having the financial freedom to pursue new ventures and take time off as necessary. So I guess I still feel like I will always be working, but eventually I hope it will be on my own terms, not someone else's.
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Re: Recent college grad here
Old 09-09-2004, 10:15 AM   #6
 
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Re: Recent college grad here

if you have a major in finance, as i am currently studying for, if you're anything like me you may enjoy such reading materials as the WSJ or Forbes, Fortune, and such. read up on companies and their prospects and make some bets with some solid DSP/DRIP plans. if you put time in it, it's very likely they could outstrip the index over 10, 20, 30 years, not to mention 0 turnover and low to nonexistant expenses. last month i scraped together $500 and opened a Pfizer DSP/DRIP account for $.47 37 cents for the stamp 10 cents for the check. That's a whopping expense ratio of .094 BEAT THAT VANGUARD!!! no seriously though, allthough mutual funds are what i use in my 401k its slowly dawning on me that a portfolio of 8-10 fee-free DSP/DRIP plans could (with moderate work on your part) trump the averages into the future not to mention tax advantages.
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Re: Recent college grad here
Old 09-09-2004, 11:45 AM   #7
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Re: Recent college grad here

I graduated more than 20 years ago, so you youngsters may consider my observations so ancient as to be outdated and useless. I won't be offended if you feel that way and post as much. But I have a few thoughts about first jobs, and careers and retirement based on my own paleo-career moves and neanderthal education experience.

After my undergraduate education, I had dozens of job offers. I chose one that I thought would be incredibly rewarding and fun. After only a few weeks, I began having doubts. In less than a year, I began making plans to quit and return to school for graduate education so that I could get a job I really wanted. I was gone before my 2 year anniversary.

After my graduate work, I landed that job I really wanted. After only a few months, I began having doubts. By 18 months I was making plans to leave and find a better job. I was gone 2 years after starting.

I took my third job simply because it seemed like the best opportunity available to me without moving again. My wife was happy with her job at that point and I decided it wasn't fair to have her move again when my job selection abilities were clearly so poor. I also figured that I was likely to be so miserable within a year or so, that she would decide that moving was not such a bad idea.

I loved my third job. I excelled at it. I made lifelong friends with my colleagues. I produced a mountain of work that stands on its merits to this day. For over a decade, I worked without a thought of ever retiring because I loved to go into the office.

Eventually I was promoted to positions that were not as rewarding or fun. They were financially rewarding, however, and that allowed me to retire early.

I guess my point is: Retirement is a better deal than working. By all means keep that goal in sight. Strive for it. Work for it. But if you are going to have to work for another 5 years or more, it is well worth it to find a job that you find some enjoyment in. Just because you haven't found a job that you enjoy or find rewarding today, doesn't mean such a job doesn't exist.

And good luck.
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Re: Recent college grad here
Old 09-09-2004, 01:24 PM   #8
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Re: Recent college grad here

Quote:
But if you are going to have to work for another 5 years or more, it is well worth it to find a job that you find some enjoyment in. *Just because you haven't found a job that you enjoy or find rewarding today, doesn't mean such a job doesn't exist.
To expand on that point there are jobs that you can and will enjoy at some point in time but after a while they can cease to be enjoyable. *I'm in that situation to some extent. *The work that I do was incredibly enjoyable at one point and I am pretty d@mn good at it. *However, over time the challenges start to look alike - they're the same problems over and over again with slightly different wrappers and minor differences in details. *If you are an intelligent person it might even be an inevitable situation for you to grow bored.

In some careers (e.g. software R&D) it can also become a difficult treadmill that was easy when you were young and had both more energy and fewer other commitments. *If you don't keep running then you will get thrown off the back of the treadmill and land in some even less enjoyable and much less remunerative job. *That is if you are still employable. *The sooner you start preparing for the day that you don't want to or can't keep running the better.

As someone who graduated from undergrad a little bit less long ago than salaryguru I wish I had realized this sooner. *I wasn't wasteful and I always saved some towards retirement but not enough for FIRE until I was in my mid/late 30's. *My old slow and steady amounts combined with my more recent heavy savings will be enough for me to get out in my mid-40's but I wish I could go sooner. *Or at least had the option to go sooner.
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Re: Recent college grad here
Old 09-09-2004, 04:00 PM   #9
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Re: Recent college grad here

Quote:
*last month i scraped together $500 and opened a Pfizer DSP/DRIP account for $.47 *37 cents for the stamp 10 cents for the check.
Funny thing... motley fool uses Pfizer as an example in an article about DRIPs today

http://biz.yahoo.com/fool/040909/1094739180_2.html

I really wish that they wouldn't use the past 20 year period as an example of the "amazing power" of DRIPs... the past 20 years have been the most "amazing" 20 years of the stock market...
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Re: Recent college grad here
Old 09-10-2004, 07:55 AM   #10
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Re: Recent college grad here

Quote:
I graduated more than 20 years ago, so you youngsters may consider my observations so ancient as to be outdated and useless.
Is it a requirement that one be a youngster to have this perspective?

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Re: Recent college grad here
Old 09-11-2004, 08:05 PM   #11
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Re: Recent college grad here

Hello soupcxan,

I'm a 27-something who is pretty far to the 'good end' of the net worth bell curve of people in our age bracket (about $360, although $80 was inheirited), and who stumbled onto this forum a few months ago.

I suppose I'm like everyone else who just assumed that I'd work until 65, then start playing shuffleboard and take a few trips before arthritis takes over and turns me into a grumpy old man.

The good thing is that my thrifty ways were already in place well before I ever had my first dryer sheet vision of kicking up my feet and truly living life like I really wanted to...so I lucked out and simply have to keep on track for a well-planned ER by (hopefully) 45.

My greatest challenge right now is finding a potential spouse suitable for a "merger of equals". My advice would be to make sure you start looking now, because finding a female who is anywhere near like-minded in the realm of finance is like finding a dryer sheet stuck in a dryer the size of the Empire State Building...much less someone who won't focus just on your net worth and have visions of getting her hands on it and burning through it. Sure, people do change, and you don't necessarily have to find someone with a same mindset to have a happy marriage (as others on this board will testify to), but the sooner you start and the smaller net worth you have, the easier it will be to meet someone with less potential for your NW to influence them.

Let us know if you start a blog. I'd be interested in comparing estimates on future costs and balance sheets to see how others in our age category are allocating their investments and what their thought process is on achieving ER.

One suggestion I have for you is to try and negotiate with your employer to pay for as much as possible with pre-tax dollars (e.g. vehicle, gas, cell phone, health insurance, Medical Savings Accounts, etc.). It increases your net takehome pay, and it saves your employer money. Larger employers won't mess around with something like that, but if you work for a small business, you might be able to work out a deal with them.


Peter
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Re: Recent college grad here
Old 09-12-2004, 12:24 AM   #12
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Re: Recent college grad here

I suppose this would be the most appropiate thread to make my first post on these boards. I am 26, and I decided earlier this year that if at all possible, I want to retire around age 40.


Some background: Though I only earned a BS, I took a while in college and didn't get out of there until I was 23. Right about then was when all the jobs relevant to my degree (computer science) sort of dried up, and it took me 8 months to find a job. I'm 'behind' some of you. :)

Well, I've been at that job for two and a half years now. It really adjusted my realism/idealism ideas pretty well. I still have vast optimism about technology, etc. but I'm pretty cynical about things within the typical corporate world with product cycles, etc.

Also, even though I knew better, though I had almost no debt at the start, the much larger income than I ever had previously tempted me greatly, and I got into some annoying cycles of credit card debt. Well, about a year ago, I stopped doing that, and around 6 months ago I decided to get serious about not spending all of my paycheck (well, I was putting some money in a 401k, but beyond that...)

So, after these experiences, I came to the conclusion that I'm far more interested in having enough money to not work if I don't desire to, than interested in the luxuries money can buy. (I have, as long as I can remember greatly valued my free time.) I've done some hard thinking and playing with numbers and gotten rather serious about how much I should be saving/investing. I'm currently aiming to invest about $24k a year, which is just a bit under gross salary - taxes - fixed costs of living. I'm on target for that for the fraction of a year since I got serious about this. The toy budget is a little smaller, but it seems that this is a good exercise in frugality and I haven't found it particularly difficult once I developed the right mindset.


Oh, and I don't care for dryer sheets (or liquid fabric softener) -- haven't used either for years. :)
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Re: Recent college grad here
Old 09-12-2004, 04:08 AM   #13
 
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Re: Recent college grad here

As long as we seem to be back on dryer sheets, has
anyone heard of this? My spouse says "soap is soap"
and thus uses shampoo, laundry soap and dish
soap interchangeably. For example, yesterday she bought out a local store's entire stock of shampoo
(big bottles - name brand) at .68 per bottle. Anyway,
this seems to work pretty well most of the time.
Except Once I washed my hair with Tide and ended up looking like Don King on a bad day

John Galt
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Re: Recent college grad here
Old 09-12-2004, 03:22 PM   #14
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Re: Recent college grad here

She's nuts John. Read all the ingredients and additives in shampoo. Do you want to be eating that off your dishes, or wearing it next to your skin?
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Re: Recent college grad here
Old 09-12-2004, 04:23 PM   #15
 
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Re: Recent college grad here

Well, I don't know Zipper. I read labels pretty
religiously and it seems to me that virtually everything we buy is full of chemicals. "Soap is soap!" was a new
concept to me but I would have to say it makes
sense. Anyway, in spite of my joke about Don
King, it seems to work just fine.

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Re: Recent college grad here
Old 09-12-2004, 05:15 PM   #16
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Re: Recent college grad here

Uh...no. Soap is not soap. Some soaps are low sudsing, high performance surfactants with strong enzymes (dishwasher soap, laundry soap), some are high sudsing and have substantially gentler cleaning agents (shampoo).

You use laundry soap on your skin and hair, you'll be looking at a 100 year old man in the mirror in a few months.

You use high sudsing soaps in your dishwasher and clothes washer, you'll be replacing the water pump in a year or so.
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Re: Recent college grad here
Old 09-12-2004, 06:45 PM   #17
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Re: Recent college grad here

Quote:
Uh...no. Soap is not soap.
Yep. Another interesting thing I read lately, when I got my first vehicle I actually cared about washing (motorcycle -- my car enjoys a nice layer of dust on it, it helps hide the peeling paint), I did some reading on car washing soaps/detergents. Appearantly, you DON'T use dish detergent (even the hand-washing stuff) on a waxed surface, unless you want to remove the coating of wax. The stuff sold for washing a car doesn't do this, and in many cases rinses off much more easily with the cold water from a hose.
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Re: Recent college grad here
Old 09-12-2004, 08:31 PM   #18
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Re: Recent college grad here

Agreed...soap for your hair has wetting agents in it (like sodium laurel sulphate or sodium laureth sulphate). And as someone else mentioned, dish soap will take the wax right off your car.
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